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Technology Stocks : ISSI a great opportunity -- Ignore unavailable to you. Want to Upgrade?

To: Ted The Technician who wrote (1036)	10/26/2000 12:55:44 AM
From: Czechsinthemail	Read Replies (2) \| Respond to of 1058

Ted, Thanks for the conference call highlights. One question I have regarding this item: 16. Sequential revenue growth in Dec quarter estimated to be around 20%. Income should be comparable to the current Sept quarter's. Does that mean they are looking at a 20% sequential growth in revenues but income remaining flat?

To: Ted The Technician who wrote (1036)	10/26/2000 6:28:50 AM
From: Ram Seetharaman	Respond to of 1058

Excellent post Ted! Since CSCO's backlog is increasing, that should bode well for ISSI going into 2001 - IMHO, they should make over $ 2 next year. Stock is extremely attractive at single digit P/E based on 2001 earnings! I have been adding steadily of late. Based on a more reasonable P/E of 15 - 20, stock should see $ 30 - 40 next year, and a possible $ 20+ this year. I hope the institutions reward ISSI, with generous purchases in the next few weeks. On a sour note - Bank of America's Rick Whitington's untimely downgrade of ISSI yesterday morning from "Strong Buy" to "Buy" - he upgraded it in the middle of the year around $ 30, so that he and his buddies could sell high! Now he downgrades at the bottom, so that they could buy low - what a clever SOB!

To: Ted The Technician who wrote (1036)	10/26/2000 6:30:25 AM
From: Ram Seetharaman	Respond to of 1058

Thursday October 26, 3:11 am Eastern Time Intel CEO says bullish on global chip mkt (UPDATE: Recasts, adds press conference details) By Nam In-soo SEOUL, Oct 26 (Reuters) - Craig Barrett, president and CEO of the world's number one chipmaker, Intel Corp (NasdaqNM:INTC - news), said on Thursday he was bullish on the global chip market, due to steady demand from makers of personal computers and mobile telephones. ``I'm pretty bullish about the global demand for semiconductors considering steady growth in the PC, networking infrastructure and wireless communications areas,'' he told a news conference. Barrett was in Seoul for Intel Korea's e-Business Forum. ``According to forecasts, global mobile phone penetration is expected to grow to one billion handsets by 2005 from about 400 million this year,'' he said. Intel said last week its third-quarter shipments of microprocessors, the brains of PCs which account for 80 percent of the firm's sales and virtually all its profits -- were little changed from the second quarter, as were average selling prices for each chip. The Santa Clara, Calif.-based company said net income before acquisition-related charges rose to $2.9 billion, or 41 cents a share in the July-September quarter, from $1.90 billion, or 27 cents, a year ago. Sales rose 19 percent to $8.73 billion from $7.33 billion, 5.2 percent higher than the second quarter. Barrett, while refraining from giving specific figures, reiterated the company's earlier forecast that fourth-quarter revenues would rise 4 percent to 8 percent from those in the third. Intel shares closed down 0\11 at $41\05 on Wednesday. KOREA'S E-COMMERCE TO EXPLODE Barrett told Korean businessmen early in the day that South Korea's Internet commerce revenue was predicted to rise 315 percent to $1.2 billion in 2000 from a year earlier. Quoting figures from International Data Corp, he said the country's Internet commerce revenue was expected to expand further to $35 billion by 2004. ``Although the figures are from a research firm, I agree with the forecast,'' he said. Barrett called for Korean companies to boost their business efficiency and competitiveness via the Internet. ``Korea's companies have the opportunity to lead Asia in deploying e-Business,'' he said. ``With 40 percent of the population already online and widespread availability of broadband access, Korea's businesses have the opportunity to grow their e-commerce and further accelerate Korea's Internet economy,'' he said.

To: Ted The Technician who wrote (1036)	10/26/2000 11:31:25 AM
From: Ram Seetharaman	Respond to of 1058

Sadly the shorts are winning and getting the better of ISSI today! However, SG COWEN is bullish as below! Reprinted - ISSI/ QUARTER AHEAD OF EXPECTATIONS; STRONG BUY SG COWEN Billy/Romaine 26 October, 2000 Integrated Silicon Solutions (ISSI $13 1/8) Strong Buy (1) Quarter Ahead Of Expectations =========================================================================== Quarterly EPS FY Sep Old EPS New P/E Q1 Q2 Q3 Q4 EPS 1999A ($0.52) ($0.23) ($0.20) ($0.06) ($0.03) 2000E $0.86 $0.89 $0.02 $0.14 $0.32 $0.41 2001E $2.00 6.6 $0.43 $0.48 $0.52 $0.56 =========================================================================== Key Points: 1. ISSI beat our estimate by $0.02 and consensus by $0.04 2. Revenue growth exceeded and profit margins were in line with expectations 3. Visibility extends about 1® quarters, which is as good as this business gets 4. Our rating and estimates are unchanged 5. The shares look extremely cheap at current levels Summary: ISSI reported FQ4 EPS of $0.41 compared to $0.32 last quarter, our estimate of $0.39 and the consensus estimate of $0.37. Revenue growth was roughly 30% Q/Q for the third consecutive quarter. Revenue was about 6% higher than we forecast. We believe that near-term visibility-in this case into mid-CQ1--for both ISSI and the high performance SRAM market are excellent. Management guided to 20% Q/Q revenue growth in FQ1. Our sense is that it can do better. Profit margins in the just reported quarter were in line with expectations. Management clearly guided to more modest profit margin expansion in FY01 than we would have expected given the rate of revenue growth. Some of this was attributed to the ongoing flow through of wafer cost increases instituted by its foundries earlier this year. However, our sense is that they were displaying some conservatism, essentially trading off the unavoidable increase in revenue guidance for more modest margin expansion and holding EPS guidance in the $1.85-2.05 range it was in. It was obvious on the conference call that some were concerned by this profit margin guidance and assume it holds some hidden message. There may well be some pressure on the shares today, though perhaps the very low PE attached to the shares militates against this. All of our sources suggest that high-performance SRAM demand is still strong and ASPs are firm. Our model is not predicated upon rising SRAM ASP. Improvements in process technology will cause declines in unit costs and should allow some improvement in gross margins even with a return to "learning curve" price declines in H2 C2001. The 5-10% of its business in low power SRAM is experiencing some softness (along with all other cell phone-oriented components) but it is too small a piece of the business to matter. Our sense is that ISSI's overall backlog position and incoming order patterns are very strong. So if there is a hidden agenda in this margin guidance, our guess is that it is management keeping the bar set low for itself. We are retaining our $2.00 estimate for FY01. Longer-term we expect ISSI to continue to gain share of the SRAM market, due to its positioning in the high growth communications markets, and grow 1®-to-2 times the 15% rate expected of the SRAM market. At less than 7x FY01 estimates the shares are very cheap by historical standards. The stock market is valuing stocks like ISSI as if a severe cyclical downturn were imminent. It is our belief that the semiconductor "cycle" has, at least, another 15 months of expansion ahead of it. If so then the correction that many of the semiconductor stocks have experienced in the last two quarters is the classic "mid-cycle correction," not discounting of the next recession. We are retaining our Strong Buy (1) recommendation.